Passion - Clear off loans

Clear off loans

14th Feb, 2015 By TeamLiveLife

Pay off your loans as early as possible so that you can shift your focus to other important things in your life. Do not take a new loan when you are due for your payments of the prior one. Cut down your expenses and if needed avoid buying luxurious stuff, it helps you save an additional amount, which you can add to the regular installments of your loan payments. When you pay off your loan, you save on interest and improve cash flow since you no longer have to keep a big share of your earnings separate.

Goals

16th Feb2015

Do not go in for over burdensome loans

Make sure you are able to manage your regular expenses even after paying EMI’S. Compare the interest rates of different lenders before you finalize a deal, EMI’S must not disturb your routine life.

Tasks

Discuss interest rates on loans from different lenders

Borrow what you can afford, not all that you are eligible for

Plan assets only after you are sure of repayment capacity

Adjudge your capacity by keeping a minimum income in mind

Do not invest more than 30% of gross income as EMIs

16th Feb2015

Frame a short term target to collate extra EMIs on your loans

No doubt, you have to compromise with your needs and cut down your regular expenses too. Put in your best efforts to pay off your loan on urgent basis and make sure you do not plan to take a new loan since it complicates the situation even more.

Tasks

Give up additional expenses and create a loan bank

Try pre paying your loan

Do not take up new loans unless you are half way through the older

Do not accumulate more than 2-3 major loans on sleeve

Go in for two loans only if one is payable over a shorter term

16th Feb2015

Improve your credit score

Pay you credit card bills on time and maintain a good record. Track all your expenses to keep a record of your payments. Use debit card for your regular expenses, spend wisely and make efforts to save as much as you can for future investments.

Tasks

Clear off credit bills on time

Avoid going past bill payment dates frequently

Do not escalate credit card based loans by borrowing cash

Ensure you keep tab on credit card statements

Ask for a yearly CIBIL/relevant scorecard from the authority

16th Feb2015

Start clearing off debts if any

Keep a track of your debts and try to clear your payments on urgent basis. Do not plan to take a new loan when you are due for your payments of the prior one, it only complicates the situation.

Tasks

Clean your debt list before investing afresh

Do not keep heaving debt

Do not take loans only because you are eligible for the same

Avoid indulging in money exchange with friends frequently

Keep track of loan graphs from time to time

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